Senegal saw a growth rate of ‘8.9%’ in Q3 of 2024 as the country’s new government made structural reforms on top of fresh oil exports.
Headlines emerged once Woodside Energy began pumping oil from the Sangomar field in June last year. The field has a 100,000-barrel capacity, per day, marking the country’s first offshore oil venture. The wider economy grew by ‘2.1%’ in the same quarter, showing health beyond the oil sector.
The International Monetary Fund forecasts growth to be at ‘9.3%’ in 2025 as more energy projects come online. British Petroleum’s $4.8 billion Greater Tortue Ahmeyim project started up, readying to ship its first gas loads. The venture will produce 2.3 million tonnes of liquid natural gas yearly shared between Senegal and Mauritania.
The Exploration of Oil: 1960s
The path to oil began slowly in the 1960s with tiny finds near Casamance and Dakar. Everything changed in August 2014 when FAR Ltd struck oil at FAN-1, finding up to 2.5 billion barrels. The team hit oil again at SNE-1 that November, with tests showing a capacity of 8,000 barrels daily.
The Latest Discovery of Oil: 2017
By March 2017, the VR-1 well struck the biggest oil column at 97 metres through several layers. August brought another discovery at SNE North-1, holding good quality oil. By 2018, the fields held 839 million barrels ready to pump, with room to reach 1.5 billion barrels.
BP’s GTA project could feed growth for 20 years… yet turning oil wealth into lasting gains requires steady hands. The government’s plan blends oil growth with investment in non-oil sectors.
New Rulers, New Rules
Prime Minister Ousmane Sonko laid out fresh plans in December, calling for a clean “rupture” from the old ways of running things. Sonko’s administration aims to close the budget deficit from ‘11%’ to ‘3%’ of yearly output by 2027. The administration’s plan to reduce fiscal spending, whilst raising tax revenue, includes bringing back fees on incoming calls that the last government dropped.
The changes go beyond money matters. Sonko’s plan touches every part of government, from farming to tourism to schools. While the words sound like standard development speak, the goals show real change; the goals stand more on their own while keeping ties to global business.
Senegal Seeks GCC Capital
Fresh from his 2024 landslide win, Senegal’s President Bassirou Diomaye Faye courted investors in Abu Dhabi and Doha to back his economic plans. During his Gulf tour, Diomaye announced headway in talks to keep nearby Sahel countries within ECOWAS: West Africa’s main trading bloc.
The diplomatic push comes after Mali, Niger, Burkina Faso and Senegal ended their military partnerships with France, their former colonial ruler, as they seek greater autonomy.
With a credible plan, Senegal enters the new year with optimism should its fiscal plans hold amidst successful diversification.
